Mortgage Settlement Unlikely to Help Homeowners in Default - 8 News NOW

Mortgage Settlement Unlikely to Help Homeowners in Default

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LAS VEGAS -- The newly inked deal between the nation's largest mortgage lenders and attorneys general from around the country is supposed to give struggling homeowners some relief but there is a group of homeowners it won't help.

People who are already in default may not be helped by the $25 billion settlement. The nonprofit group Legal Aid of Southern Nevada holds free foreclosure workshops twice a month. Jim Berchtold supervises the program. He says the new federal mortgage settlement may give hope to homeowners still paying their mortgage, but that is not the case for most of the people he works with.

Desert Underwater: The special section on the foreclosure crisis in southern Nevada

"People are getting sued by lenders. People are getting sued by credit card companies. People are getting kicked out of their homes. By the time they get to this point, it is not a start, it is somewhere towards the middle to the end," Berchtold said.

Berchtold says the end for many people is losing their homes. He says, by the time he sees people, they have already lost their jobs and their income. While there are signs that the economy is improving, Legal Aid of Southern Nevada says -- from its perspective -- things are getting worse. The group says if the job market does not improve more people will not have the money to pay their mortgage and the cycle of desperation will continue.

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